So when big power users consider putting up systems to create solar
power, they run into a big problem.

"Frankly, the solar systems are still very expensive," said Dave
Umstot, in charge of facilities for the San Diego Community College
District.

Umstot figures the district can power about half of its classrooms,
computers and air conditioners with the sunlight that shines on its
campuses every day.

But that would cost millions and require crews to ensure that the
systems remain in tip-top shape. And the district doesn't pay taxes, so
federal tax incentives designed to promote solar wouldn't apply.

Instead, the district has turned to a private company that will fund,
build and own the solar system. The district will pay only for the power
it uses.

That kind of deal – known as a power-purchase agreement, or PPA – is
making solar profitable because it allows investors to buy into
government subsidies designed to jump-start the industry and lets users
avoid upfront costs and maintenance.

"PPAs are really the motor behind making solar projects happen in
America," said Alexander Welczeck, an executive with Solar Power
Partners, a San Francisco firm that puts together such deals. "It just
financially makes more sense for everybody."

Welczeck figures 80 percent of the market for big systems – 800
kilowatts or more – are financed this way.

In the college district's case, instead of buying solar panels
directly, it signed a deal with an El Cajon company for 2.4 megawatts of
solar panels on the district's property. In return, the system owner,
Borrego Solar, will sell power to the district for 20 years at a discount
from what San Diego Gas & Electric is charging today.

"It guarantees them electricity, and it guarantees the owner a steady
revenue stream," said analyst Michael Bachman, who tracks the solar
industry for Pacific Crest Securities in Portland, Ore.

The deals are becoming available to homeowners. SunRun, a San
Francisco company, focuses on financing and installing solar systems on
homes and selling the power to homeowners.

"People like the idea that we own the panels and have to take care of
them," said Lynn Jurich, SunRun's president.

Bigger deals, like Borrego's with the community college system,
district, have similar motivation, Umstot said.

Under the agreement, Borrego will install solar panels on car ports in
parking lots, the top deck of a parking garage and on the roofs of a gym,
a theater and a library.

The district pays less for that power than it would pay SDG &E because
it will be provided in the middle of the day, when electric rates are
highest.

The district cannot sell extra power to others, but it doesn't have to
use the power it produces the moment it's made.

When the system produces more power than the district can use – such
as during weekends when classes are not in session – the meters
essentially run backward, and the district gets an equal amount of power
from the utility later.